Arhaus, Inc.
Arhaus, Inc. Fundamental Analysis
Arhaus, Inc. (ARHS) shows weak financial fundamentals with a PE ratio of 17.63, profit margin of 5.40%, and ROE of 19.87%. The company generates $1.4B in annual revenue with weak year-over-year growth of -1.29%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 35.9/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze ARHS's fundamental strength across five key dimensions:
Efficiency Score
WeakARHS struggles to generate sufficient returns from assets.
Valuation Score
ModerateARHS shows balanced valuation metrics.
Growth Score
WeakARHS faces weak or negative growth trends.
Financial Health Score
ModerateARHS shows balanced financial health with some risks.
Profitability Score
ModerateARHS maintains healthy but balanced margins.
Key Financial Metrics
Is ARHS Expensive or Cheap?
P/E Ratio
ARHS trades at 17.63 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, ARHS's PEG of 4.41 indicates potential overvaluation.
Price to Book
The market values Arhaus, Inc. at 3.23 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 5.31 times EBITDA. This is generally considered low.
How Well Does ARHS Make Money?
Net Profit Margin
For every $100 in sales, Arhaus, Inc. keeps $5.40 as profit after all expenses.
Operating Margin
Core operations generate 7.14 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $19.87 in profit for every $100 of shareholder equity.
ROA
Arhaus, Inc. generates $5.33 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Arhaus, Inc. produces operating cash flow of $159.48M, showing steady but balanced cash generation.
Free Cash Flow
Arhaus, Inc. produces free cash flow of $80.92M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $0.57 in free cash annually.
FCF Yield
ARHS converts 6.29% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
17.63
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
4.41
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.23
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.95
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.43
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.34
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.20
vs 25 benchmark
ROA
Return on assets percentage
0.05
vs 25 benchmark
ROCE
Return on capital employed
0.11
vs 25 benchmark
How ARHS Stacks Against Its Sector Peers
| Metric | ARHS Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 17.63 | 25.25 | Better (Cheaper) |
| ROE | 19.87% | 1170.00% | Weak |
| Net Margin | 5.40% | 742.00% | Weak |
| Debt/Equity | 1.43 | 0.77 | Weak (High Leverage) |
| Current Ratio | 1.34 | 9.19 | Neutral |
| ROA | 5.33% | -6467.00% (disorted) | Weak |
ARHS outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Arhaus, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
-47.84%
Industry Style: Cyclical, Growth, Discretionary
DecliningEPS CAGR
-12.18%
Industry Style: Cyclical, Growth, Discretionary
DecliningFCF CAGR
48.98%
Industry Style: Cyclical, Growth, Discretionary
High Growth